Obamacare for Dummies by Thomas Martin Sobottke


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Let’s begin by legally stipulating that the Obamacare national website rollout is a disaster and that insurance companies unhindered by the new law are cancelling private, individual policies in much larger numbers than the President told the nation in his 2012 campaign and replacing them with plans that comply with the law but are much more expensive than their predecessors.

Nevertheless, the website is well on the way to major improvements by a new IT team the President is pushing to get people enrolled in the program as soon as possible. Their timeline for a better rollout is November 30th 2013. The wise will just say it will be humming before the end of the year. Information and Enrollment via the telephone is also being used as a stopgap.

Many of the cancelled plans are not nearly as good as the people who are losing them might be willing to admit, or they may not know their full options, or just how exposed to out of pocket expenses they really are.

First, if asked firmly enough, the company cancelling the plan and substituting a new one and dozens of competitors not participating in your State exchange should have a dozen or more plans from which to choose to meet your needs. Second, there is your State’s exchange or the one being set up now by the Federal Government if your State has said “NO” to Medicaid expansion money from the Federal Government and developing an exchange market for your State based on its individual needs.

States with Democrats as Governors or Democrat controlled legislatures or both are almost certainly to have developed their own exchanges or state insurance markets early on and those States website’s though experiencing a few minor glitches are working much better. The deal is that those States that actually worked with Health and Human Services (HHS) and cooperated with the President as partners are way ahead of States with a conservative, anti-Obamacare, “NO” to federally provided money or any sort of State exchange. States like California, Washington, even Oregon, Rhode Island, Kentucky and more are doing well. Massachusetts has had this since 2007 and insurance costs to consumers have dropped significantly, and 97% are now ensured in the State—the highest total in the nation.

If your State is let’s say Wisconsin, where Republican Governor Scott Walker said “NO” to Medicaid Expansion, Wisconsin taxpayers are not only losing out on something like a hundred million dollars for the poor’s healthcare under Obamacare, but are going to spend $119 million more tax dollars just for the privilege of spitting in the President’s face and opposing his signature health program. In Wisconsin, the Federal Exchange is barely up and running and very few State residents who are not qualified to be ensured under the State’s Medicaid and Badger Care programs, yet who need health insurance, have the kind of help via navigators and the aid of charitable groups with a healthcare focus.

Oh, and in Wisconsin Governor Walker actually is in the process of tossing over 93,000 of the poorest State residents off of the State’s poverty level health assistance program Badger Care. The Wisconsin legislature, the Governor, and State agencies here have if anything tried to interrupt having anything happen on Obamacare here. And Walker waited almost until the very last few days to decide he was not setting up a State exchange in Wisconsin giving the Federal Government quite a time lag in hitting the ground running when October 1st rolled around. It is quite a contrast.

It get’s worse for the Badger State. Because Scott Walker threw 93,000 or will do so by the end of the year off of Badger Care, and refused to expand Medicaid properly, Wisconsin Obamacare recipients in the Federal exchange here will pay 79 to 99 percent more for it than in neighboring Minnesota, a demographically almost Twin State. In Minnesota they took the Medicaid expansion money and are expanding it and set to work on setting up their own Minnesota Obamacare exchange very early. That translates into $1,000 more a year on the Bronze plan in Wisconsin, relative to neighboring Minnesota, and $1,827 on the Silver Plan. This information from Milwaukee’s Shepard Express newspaper in a recent article.

Essentially, insurance companies ready to participate in Wisconsin’s lagging Federally set up exchange market have calculated they will have more high cost recipients to insure relative to low cost, younger, healthier, members of the Obamacare pool forming up in Wisconsin. Walker, the Shepard Express reports could still listen to Milwaukee County’s resolution to ask the State to reconsider taking the Medicaid money and perhaps even doing a State exchange system rather than one set up by the Feds. Walker is adamant he won’t do it.

It is logical. States that work with the Federal Government in implementing the new healthcare law are much further along and in much better shape in meeting their citizen’s healthcare needs then those States with almost extremist Republican Governors and legislatures who are doing all they can to destroy Obamacare in their States. We have 50 States and truly fifty different sets of results thus far and in the coming months based on partisan affiliation of State leaders and whether or not they have received Medicaid Expansion money and have moved early to implement the law in their States.

Massachusetts, the model for Obamacare, had an initial set of glitches in its website and telephone operation for enrollment in 2007. Then Governor Mitt Romney, a conservative Republican former corporate businessman, worked with a Democrat controlled State legislature and a good public relations campaign where the people of the State were NOT working at cross purposes with each other. Romney today said his plan in Massachusetts has nothing whatever in common with Obamacare. Yet, the two MIT experts who masterminded what was originally the conservative Heritage Foundation’s structural plan have both spoken out completely to the contrary. Obamacare and Romneycare are very similar and the plan now fully in place in Massachusetts is working well and the people there do NOT want to get rid of it.

The Massachusetts experience also saw just two percent of those targeted enroll and choose a plan in the first weeks of their 2007 rollout. They were shopping the market within the program. The lion’s share of enrollments and plan choices were made in the closing weeks of the sign up period. Look for the same thing here nationally with Obamacare but only on a longer time frame to achieve it.

The President is going to have to by executive order roll back the deadline target dates in coming months about 90 days to reflect the realities of implementing such a much larger, and more complex program, and with half of Americans favoring or helping to get this done and the other half about ready to get their guns and overthrow the Federal Government. Here too is quite a contrast when comparing where we are on Obamacare vs. Romneycare.

It reminds me of a line in the classic Howard Hawks film To Have and Have Not where a hot and smoky and young, Lauren Becall debuted with veteran actor and soon to be husband Humphrey Bogart. Bogart plays a crusty yet masculine fishing boat operator who has gotten himself bottled up in Martinique, a French controlled Caribbean Island in 1940 and Ms. Becall is somebody who has run out of money after she has run out of her South American wanderlust. Ms. Becall finally gets a good smooch from Bogie and it is obvious she likes it. She says, to a Bogart who is playing hard to get, “it’s better when you help.” That is exactly what we need from all Americans in regard to Obamacare. It has been the law since 2010. It is just this past month when the most vital part of the law is in operation for the first time.

Yes, Republicans, it is better when you help. Frankly, it is better when we all work to make a law work better rather than shutting down the government, spending $24 billion to do it, and all in a vain attempt to defund something that is mandatory spending and with a Democratically controlled Senate and a President absolutely committed to helping millions of Americans get health insurance for the first time.

This week I ran into a couple of young people who told me horror stories about Obamacare.

They were relating what turned out to be a couple of stories of in one case “Junk Insurance” that hardly covers even catastrophic illnesses, and exposes the holder of the policy to incredible and actually bankrupting medical expenses. The largest cause of bankruptcy in the United States is out of pocket expenses for health care from people who are insured!

Under Obamacare, the baseline plans limit a person’s financial exposure to $6.500 when facing serious illness or injury. Previously, Americans could wrack up twenty, thirty, or forty thousand dollars or more and then be forced to declare bankruptcy and even lose their homes.

Let’s get some numbers here. I sold insurance in 1980 to the individual private market for single persons or families. In those days a Cadillac plan for a family would be anywhere from $1,000 per month to $1,400 per month. Plans with some defects yet serviceable would run my customers something like $600 per month The cheap but still legitimate plans could run you anything from $100 to $200 a month. Anything less than that, well, my company was pulling a fast one. I never sold one of those. I have my moral standards.

Now, thirty-two years later, and double digit premium increases each year for individuals and group insurance, I hear of a 62-year-old man who loved his $52 a month plan and it is now replaced or being offered as something five times as expensive to comply with the new Health Care Affordability Act. Let me tell you, any individual who has taken out a pre-Obamacare market plan for less than a hundred bucks in 2013 with the beneficiary being past sixty, no matter how healthy, is not getting anything. It is junk, or shall I simply say a piece of shit. Even back thirty-two years ago that is precisely the plan that might be in the back of the dozen or so plans the company I worked for offered, with varying costs, deductibles, and percentage coverage’s for various medical conditions. Now, I don’t think the man would get a thing.

A second young person, with an individual, private family health plan pre-Obmacare was spending $228 a month. Well, even back in 1980, that would be a plan that rarely covered anything at 100%, went in many areas beyond 20 percent out of pocket expenses even with the deductible the man said was $500. Serious illness to he, his wife or two kids would really strain the family’s ability to pay for their care. This plan pre-October 1st really could not be that good as the man assured me it was though at a price he loves.

Another comparison, Cadillac business executive group insurance premium costs per family or those to police officers, fire-fighters and teachers cost that unit of government or the private employer between $16,000 and $18,000 per year these days. That is reality. Of course you can get group or employer group plans running right down to junk plans. I saw an ad for Walmart saying employees could get health insurance from Walmart for $40 per month. Even allowing for the fact that this is an employee share quote it isn’t much. Seeing as how Walmart put millions of its employees around the nation on Medicaid or State assisted insurance plans like Wisconsin’s Badger Care I am not all that impressed.

This man with a family plan at $228 a month said the new plan is ten or eleven times the cost of the old one due to Obamacare. That simply cannot be true. He also claimed that the deductible went up from $500 to $5,000 and while a few more things were covered he did not want them covered. Factually, that very company should still have a plan just a little more expensive, say $300 or so a month rather than the $228 or at least one of its private non-Obamacare exchange participating but licensed in Wisconsin competitors will be happy to offer to get his family’s premium dollars for the next year.

Factually, in Massachusetts where the Obamacare Plan is in effect, costs have dropped significantly on most individual private or group plans whether single or family.

Nationally, the last three years have shown that the premium increases in the cost of health care have risen at a rate that is the lowest in over half a century. This is the front end of Obamacare in action here and the expectation of it being implemented in the thinking of insurance companies nationwide.

A lot of people around the nation with cancellations of policies they liked and with new ones put in front of them with poorer coverage and higher cost are victims of a bait-and-switch operation. As a former member of the industry however brief my stint of a few years was, if competitors are consulted he can get something comparable and a bit better for a little more. The overall cost effectiveness to that man at $228 will be worth what is saved in out of pocket expenses alone. And he still has the option of going to Obamcare.gov when it is properly up and enrolling. He’ll be able to afford what he had or even have much more for not much more. If his company is asking for ten or eleven times as much premium dollars or even Obamacare is, it is just a mistake.

Even now, health care rates reflect the cost of delivering and covering health care. They have not since October 1st gone up ten times or one thousand percent!

Here is what is working brilliantly thus far in Obamacare or more properly the Healthcare Affordability Act right now:

First, thousands upon thousands of people with even multiple pre-existing conditions now have what they most need covered, and not excluded from their plans. Excluding pre-existing conditions has already been fully implemented around the nation. Children, moms, dads, and others can tell us first-hand about how they are getting the care they most need—and expensive care at that, even life-saving care when they could not previously do so.

Second, if your company spends more than 20 percent of your total annual premium cost for anything other than care for you and your family the difference in real dollars must be refunded to you at the end of the policy year. There are people who were surprised to get their first fairly significant checks from companies slow to adapt to the new realities of the law.

Third, market pressures as Obamacare exchanges, first those put up by individual States as provided for under the law, and now later as Federal exchanges come on line, are showing downward pressure on costs. Does that mean everybody will save money? No. There will be those who have to pay somewhat more for well, more and to pay much less out of pocket. They win in the end.

Nobody stays perfectly healthy for a lifetime. Most have somebody in the family suddenly after wonderful health get really sick. You need insurance even if you are one of those twenty-something invincibles. Get enrolled in Obamacare. It will provide some insurance against emptying your bank account for a hundred bucks a month or so. Maybe even a tad less.

Finally, this is the Heritage Foundation Conservative Republican plan from as late as 2007, when Mitt Romney was praised by his party for doing the same thing in Massachusetts.

Obamcare puts faith in private, capitalist markets operating to increase competition via some government regulation and drive down costs and thus make good quality health insurance available to us all.

This is not single-payer, so-called “Socialist” health insurance, this is not the single-payer Medicare we all need someday or now. There is not even an option for a single American to purchase a public option government plan that is non-profit. The conservative Heritage Foundation back in 1997 when the structure for this plan was put out there would not want a hint of anything anti-capitalist and without a full faith in markets to operate properly with proper competition and some essential government regulation to put it into force and protect those enrolled in private plans from private for profit insurance companies.

This Obamacare thingy is dealing with ten percent of Americans who need better healthcare for a more affordable cost or those just plain without it. Some thirty million Americans between Medicaid expansion and Obamacare private exchange plans need to be insured. This will take time. It is going to be a full year at least until the verdict on whether this will work or not will be in. The first month of the rollout is NOT a sufficient time to get a read on this thing in operation on the ground across the nation.

Oh, and you Republican committee members grilling Secretary of HHS Kathleen Sebilus for lunch the other day in the Land of Oz and asking all about Kansas just need to have a serious reality check. Questions on the website or IT situation from the actual people doing the IT work, and data from the States furthest along would be more appropriate lines of investigation for this Monkey Court of a House of Representatives committee that does not want to like Lauren Becall tells us in that old film: “It’s better when you help”.

Dr. Thomas Martin Sobottke
for Struggles for Justice

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